Former oil trading and tanker tycoon Lim Oon Kuin and his two children have been hit by civil legal actions from the liquidators of failed Singaporean oil company Hin Leong Trading and HSBC Bank.
In a court case that kicked off in Singapore last Thursday, Hin Leong Trading’s liquidators are demanding that its founder Lim, together with his two children, cough up $3.5bn for debts that allegedly were a direct result of years of fraudulent actions by the trio.
Lawyers from law firm Drew & Napier, acting on behalf of Hin Leong’s liquidators, told the court in their opening statement that 81-year-old Lim, together with son Evan and daughter Huey Ching — both directors — had hidden Hin Leong’s dire financial situation for years in order to trick banks into providing funding.
Drew & Napier senior counsel Cavinder Bull claimed that the company had been insolvent since 2012 despite the Lims portraying it as profitable.
“They did this through fraudulent and dishonest activity including, among other things, the creation of fictitious gains to conceal accumulated trading and other losses, the forgery of documents, the manipulation of Hin Leong’s accounts through improper accounting entries, the overstatement of Hin Leong’s inventory and the obtaining of financing through improper means,” Bull said.
The Lims were also accused of causing Hin Leong to pay them dividends of $90m in 2017 and 2018 even though the company had not earned a profit.
In addition, Bull alleged that Lim, despite initially making admissions over instructing staff to conceal losses of $800m, was now trying to pin it on employees who did not stand to profit personally from the fraud.
Bull claimed Lim and his children “refuse to admit anything, even the most basic facts about the financial state of Hin Leong” and concluded by saying they “must be held accountable for their fraudulent actions”.
HSBC has also brought civil action against the Lims for two alleged forgery-related applications that resulted in the bank paying Hin Leong $111.7m in March 2020, a mere month before the company collapsed.
Thereafter it quickly emerged that Hin Leong’s debts to 23 lenders totalled more than $3.85bn, with HSBC, which owned $600m of the debt, being the most exposed.
Lim, who at the time of the company’s demise took full responsibility for the concealment of the $800m in losses stemming from failed futures trading, has since been charged with more than 120 fraud charges in criminal court.
Wheelchair-bound, and appearing very frail, Lim pled not guilty to these charges when the trial opened in April.
The collapse of Hin Leong was quickly followed by the demise of the Lim family’s tanker operating arm Ocean Tankers and shipowning company Xihe Group. This led to one of the largest tanker fleet sell-offs as Xihe’s fleet of more than 130 tankers was liquidated over a three-year period.
